Approximately 85% of Australia's population live along the coastal fringe, an area with high exposure to extreme inundations such as tsunamis. However, to date, no Probabilistic Tsunami Hazard Assessments (PTHA) that include inundation have been published for Australia. This limits the development of appropriate risk reduction measures by decision and policy makers. We describe our PTHA undertaken for the Sydney metropolitan area. Using the NOAA NCTR model MOST (Method for Splitting Tsunamis), we simulate 36 earthquake-generated tsunamis with annual probabilities of 1:100, 1:1,000 and 1:10,000, occurring under present and future predicted sea level conditions. For each tsunami scenario we generate a high-resolution inundation map of the maximum water level and flow velocity, and we calculate the exposure of buildings and critical infrastructure. Results indicate that exposure to earthquake-generated tsunamis is relatively low for present events, but increases significantly with higher sea level conditions. The probabilistic approach allowed us to undertake a comparison with an existing storm surge hazard assessment. Interestingly, the exposure to all the simulated tsunamis is significantly lower than that for the 1:100 storm surge scenarios, under the same initial sea level conditions. The results have significant implications for multi-risk and emergency management in Sydney.